I didn’t believe it when I first heard it, but two independent contacts confirmed parts of it late last week: the entire Xbox identity project—logo, slogan, even color palette—has been frozen. Not redesigned, not refreshed. Frozen. Legal literally locked the brand assets folder. Reason? Leadership is preparing to spin Xbox into a wholly separate subsidiary before the end of FY 26.

Internally the move’s codenamed Project Sable (yes, ironically). The idea is to off-load the “consumer-facing loss center” into its own entity, let it run semi-independent, and give Microsoft proper a clean financial surface for cloud and AI. What that means in plain English: Xbox would no longer sit under Microsoft’s Entertainment division. It’d be a ring-fenced brand with its own P&L—free to sink or swim.

Phil’s name isn’t even on the early structure charts. The draft org tree lists a placeholder: “Interim Executive Liaison – Gaming Transition.” That’s how far he’s been sidelined.

The memo that leaked with it was worse: it called the brand’s current reputation “functionally impaired” and compared its market position to Sega in 1996. One paragraph actually used the phrase “post-relevance stewardship.”

Another section detailed a plan to end all in-house physical hardware by 2027 and replace it with “distributed access devices” built by OEMs—essentially third-party xCloud sticks and cheap handhelds with Xbox branding. They’re already talking to TCL and Lenovo.

The last page of the deck contained the quote that’s now circulating internally:

“We will measure success not by units sold, but by persistence of presence.”

That line hit everyone like a eulogy.

If this goes through, Xbox as a Microsoft division dies quietly in a legal filing. Phil retires “to advisory capacity.” And the brand continues as a ghost company licensing out nostalgia.

It’s the most ignominious moment yet for Xbox—no scandal, no explosion, just a long fade into corporate abstraction.

(http://www.autoadmit.com/thread.php?thread_id=5784298&forum_id=2Elisa#49333808)